More sobering questions about Measures A & B

“As pension systems move toward full funding (the goal of new higher CalPERS rates) year-to-year jumps in employer rates are more likely.”

—From a Calpensions article, emphasis mine. The point is if Calpers increases the cost to Stockton of funding city pensions, that money has to come from somewhere.  Opponents of Measures A and B will argue the money will have to come at the expense of the police department’s budget.

“Volatility” grows with increasing assets,” the article quotes an expert saying. “If there is an investment loss, a bigger rate increase is needed to fill a bigger gap.

“Milligan previously has said that a rate increase is likely to result from a review early next year of economic and demographic forecasts, including new projections that people on average are living longer.

“Another rate increase could result from a California Public Employees Retirement System board review of asset allocations later this year.”

Sheesh. How many rate increases is Stockton looking at? Are they allowed for in the city’s long-range budget forecasts?

Yes, said City Manager Bob Deis.  

“I feel very good about our PERS assumptions,” Deis said. “We actually assumed PERS would adopt more conservative assumptions in future. I know of no other city doing what we’re doing.”

 

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    Michael Fitzgerald

    Mike Fitzgerald is The Record’s award-winning metro columnist. His column runs in the paper three times a week. Born in San Francisco, he was raised in Stockton. His column covers diverse beats including, sometimes, the offbeat. Read Full
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